And while it's at it the analysis also concluded that immigration cannot adequately address the issues affecting an ageing society.

In an analysis of the "big Australia" debate in its 2011 annual report published yesterday, the commission said the economic impact of immigration "is sometimes clouded by misperception".

"Two benefits that are sometimes attributed to immigration, despite mixed or poor evidence to support them, are that immigration is an important driver of per capita economic growth, (and) immigration could alleviate the problem of population ageing," it says.

The commission also notes immigration doesn't affect household wages overall, though particular sectors could be adversely affected if there were a large influx of skilled immigrants.

And it warns that trying to slow the impact of an ageing population on the economy by bringing in young workers is only a sugar hit.

These findings are nothing new. A British House of Lords study released in 2008 found that record levels of immigration to the U.K. brought negligible economic benefit the nation. Here in Canada a study by the Fraser Institute found that immigration costs more in tax dollars every year than it sends to government coffers.

So here we have three countries with mass immigration polices. And we have three immigration policies that all fall short of generating the kind of promised economic growth that was supposed to bring benefits to Canada and Canadian. It was assumed that immigrant driven population growth would bring economic growth and prosperity to all but we know that assumption is a dead one so let's bury it six feet under where it belongs.

Housing prices for Canada's two top housing markets are insane and you have speculative Asian real estate capital to thank for that coupled with the increased demand one should expect from the highest immigrant intake numbers in the world.

This has adverse consequences for Canadians. It means a greater portion of their disposable income will have to go towards servicing a mortgage while still trying to meet the costs of every day living. As a result Canadians are carrying record levels of household debt which seriously threatens the nation's economic future.

Many have sought refuge in cheaper housing supplied by the urban sprawl communities built on prime farmland - the richest in the nation - that encircle Toronto and Vancouver, forever destroying the agricultural benefits that land provided. This means greater commute times to work which translates into less leisure time for Canadians as they spend more time away from home stuck in gridlock traffic. The connection between Toronto having the worst traffic in North America and it being the Canadian city that receives the bulk of immigrants should be obvious to even the most casual observer. And this is to say nothing of the polluted air generated by so many idling cars and the health effects it has on those who live in the city.

It's saying a lot when young professionals cannot buy into Toronto's or Vancouver's housing market even to explaining why Canada has a low birth rate. Immigration has increased the cost of housing while simultaneously driving down incomes and thus has increased the cost of living for us all. When you can barely provide for yourself without taking on substantial debt it makes no sense to breed yourself into poverty. And this phenomenon has been observed in immigrants and their Canadian born children as the fiscal realities of living in Canada has caused them to assume birth rates on par with their Canadian counterparts.

It's expensive to live in Canada and immigration has not made that any better, indeed it has made the situation worse. But if Canadians realize their low standard of living in relation to previous generations has been influenced in part by immigration perhaps then they'll be compelled to do something about it.

Thursday, 9 February 2012

Is Canada is in the midst of a housing bubble. Some say yes, others say no. I find myself in the camp of the former. There are several factors at play that cause me to think so.

One is housing prices are outpacing income growth compelling many young Canadians to delay home ownership. This leaves one wondering where the demand is coming from needed to buoy and inflate Canadian real estate prices since a significant segment of the real estate market - first time home buyers - are being priced out of it.

Another red flag is the low key interest rate issued by Canada's central bank, the Bank of Canada. A key low interest rate allows Canada's charted banks and other lending institutions to offer low prime interest rates to their customers. This means cheap money that can be borrowed to finance the purchase of a house and other large ticket items. And it appears the Bank of Canada intends to keep the key interest rate low at 1% continuing a 16 month trend into the first quarter of 2012.

Low interest rates discourages saving and encourages spending. This is because inflation decreases the purchasing power of money over time so you're better off spending your money in the short term instead of parking it in a low interest savings account where it will be losing value if the rate being offered is below inflation. Couple this with stagnant incomesfor over 30 years it should come to no surprise to learn that Canadians have reached record levels of household debt much of it found in the mortgages Canadians are carrying. Canadian household debt levels are even greater than those in the U. S. and the U.K. yet somehow our economy is in better shape than those two countries, or so we're told.

So we have a situation in Canada where housing prices are rising faster than the average Canadian's ability to meet those prices in an economic environment of low interest rates and record levels of household debt while inflation current rests at 2.3%. This is all feasible, however, so long as interest rates stay low and housing prices keep rising.

Indefinitely.

We know that's not possible but it's the reason so many Canadians are buying houses they cannot afford. Thanks to cheap money they intend to buy houses they assume will increase in value at a rate greater than inflation. It's a better long-term investment than a savings account as well as an attractive short term investment if they intend to flip the property. However, we know that many young Canadians are postponing home ownership because of sky-rocketing house prices. So where exactly is the demand coming from that not only keeps house prices in key Canadian markets from falling but continuously rising? What's driving the market? Perhaps looking south can help us answer that.

A while back I finished reading a book titled The Big
Short: Inside The Doomsday Machine. It's about the global
financial meltdown that originated in the U.S. as told from the perspective of insiders.

In a chapter called "How to Harvest a Migrant Worker" we learn of a Mexican migrant strawberry picker who secured a loan to purchase a
U.S.$724,000 home on a U.S.$14,000 yearly income. We also learn of a nanny from Jamaica who along with her sister was able to own six
townhouses in Queens, N.Y. They were able to do this because the financial
system developed into a complex ponzi scheme that could only survive so long as
house prices kept rising and interest rates remained low.

It got me thinking about immigration's role in the financial meltdown and why
the U.S. was seemingly reluctant to police its southern border and
stop illegals from challenging its sovereignty. It was because these illegals added to an ever increasing
customer base that was essential to keep the housing market robust. They provided the much needed oxygen to inflate the bubble.

You see, it was quantity not quality that fuelled the U.S. housing market prior to its crash. It didn't matter how risky the loan was because the originator of the loan had no intention of holding onto it. The loan was to be hidden amongst a bunch of other risky loans, hidden amongst other loans to be compiled and repackaged as a mortgage backed security and sold off to investors. And these investors didn't know how toxic these securities were because the bond ratings agencies - Stand and Poor's, Moody's, and Fitch - gave them triple A ratings declaring them to be one of the safest investment vehicles around. And the originator of the loan made a commission through the selling of these mortgage backed securities. The more you sell, the more money you make, the richer you become while freeing yourself of risk by dumping that risk onto unsuspecting clients.

The financial meltdown is more complicated than that but what is important to realize is how it couldn't have reached the magnitude that it did without the help of mass immigration. Since it was all about volume loan originators needed a steady stream of people to sign their names on sheets of paper that can then later be sold off to some putz investor. It was a pyramid scheme and in order for it to remain sound you forever need a growing base to keep the structure from toppling in on itself and mass-immigration driven population growth was going to provide it.

The immigrants aren't to be blamed, of course. They were dupes tricked into signing complicated loans they barely understood but were nevertheless sold on by 1) the promise of continuously rising house prices and 2) low key interest rates set by the Federal Reserve of the United States, the central bank of the U.S.

The parallels here in Canada are striking. We have rising housing prices with a low key interest set by the central bank. But for prices to keep increasing the demand must be coming from somewhere and it's undoubtedly coming from immigration, just like it was in the U.S.

Housing prices are rising mostly due to demand driven by
immigration along with real estate speculation from Asians and Russian petro-dollars (and allegedly Asian and Russian criminal organisations looking to launder their money). However incomes are not
keeping apace. Immigrant incomes are low and slow to increase in a time
where real incomes have remained stagnant. Immigrants are able to secure a mortgage because of low interest rates, liberal mortgage standards, and a belief housing prices will keep rising. But how long can this last?

In
the U.S. a low
two year "teaser rate" suckered low income earners into mortgages
they could no longer afford once the teaser rate expired. However as long as the
price of the house increased they were able to refinance. But it was
unreasonable to expect this to continue indefinitely and thus the defaults
started to role in and the market crashed. How long can the Bank of Canada keep the key interest rate low? How many new home-owners, many of them immigrants, will be able to afford the houses they bought once the key interest rate rises? Remember, Finance Minister Jim Flaherty bought $50 billion in residential loans in 2008 on top of a $25 billion credit backstop which, for some, amounted to a $75 billion bailout of Canada's chartered banks. Why was this necessary?

But the parallels don't stop there. As late as January 30th of this year Canada's financial regulator, the Office of the Superintendent of Financial Institutions (OSFI), expressed concern over the "increasingly liberal" mortgage standards being practised by the nation's lenders. To the OSFI they almost shadow the sub prime loans that were being issued in the U.S. exposing them to "emerging risk."

Banks and other lenders are becoming “increasingly liberal” with mortgages and home-equity credit lines that don’t require individuals to prove their income, according to documents obtained by Bloomberg News under freedom of information law from the Office of the Superintendent of Financial Institutions.

The mortgages, typically granted to the self-employed and recent immigrants, “have some similarities to non-prime loans in the U.S. retail lending market,” the documents show. “Non- income qualified” lending has been added to a list of issues to be considered by OSFI’s “emerging-risk committee,” the documents show.

In response mortgage lending has been tightened for recent immigrants as well as for the self-employed and high risk borrowers. This begs the question, how long have "liberal mortgage" standards been the norm for recent immigrants? How many properties have been bought with these "liberal mortgage" standards? And why is a tightening of mortgage lending to recent immigrants a cause for alarm? It's probably they have a very good reason to be worried. It'll mean the party's over.

Those mortgages, usually granted to the self-employed and recent immigrants, “have some similarities to subprime loans in the U.S. retail lending market,” the Bloomberg story says, quoting from documents obtained from the Office of the Superintendent of Financial Institutions.

That concern may be why FirstLine — once the biggest mortgage lender in Canada and often a lifeline for self-employed and new immigrants — has been slowly backing out of the mortgage business for about a year now, brokers say.{...}

No one is suggesting Canada is anywhere near as risky as the U.S. where some 30 per cent of homeowners were in over their heads as house prices collapsed. That led to the subprime mortgage crisis that decimated the housing market south of the border, Madani said.

Bank and housing experts have estimated far fewer than 5 per cent of Canadian mortgage-holders are at risk.

But there are worrisome similarities on four other fronts, Madani said in a telephone interview Wednesday: Canada has seen a “very sharp” increase in house prices relative to incomes the last few years; substantial growth in ownership rates; household debt has risen to record levels and there are “significant signs” of overbuilding, especially in the condo market, he said.

The IMF along with The Economist have concluded Canada's housing market is over valued and due for a correction. A recent survey ranked Vancouver as the second most unaffordable city in the world following Hong Kong in the top spot. But when you appreciate the fact that Vancouver is pretty much a subdivision of Hong Kong, a literal colony of China, and Asians have turned the city into a playground for real estate speculation Vancouver's high ranking makes sense. When you can't tell the difference between a crack shack or a mansion you get the feeling that the market is out of whack.

Here in Toronto it's no different as average house prices rise above $600,000. The sky line is littered with cranes erecting condos to supply an over-supplied condo market giving Toronto the lead in high-rise development on the continent. As 2011 closed Toronto had 132 high-rise developments under-way in comparison to Mexico City which had 88 and New York City which had 86. This is staggering considering there is no real demand for it. What is driving the condo boom in Toronto is real-estate speculation encouraged by the investor-immigrant program. Foreigners, primarily Chinese, are buying their way into Canada, and for their families, via condo projects. With cheap money thanks to low interest rates they are either funding the projects themselves or are buying multiple units at a time and counting them as "investments" to fulfil their requirement for permanent residency status. (It's a sham when you consider that once the properties are successfully flipped they get Canadian citizenship for nothing plus a song.) These people are speculators since there is no guarantee that there will be a buyer for each of the units they're holding onto. It is these speculators who are not only creating the supply but also providing the demand as they buy multiple condo units they have no intention of living in and no intention of holding onto for an indefinite period because they intend to flip them. But what if there are no buyers for them?

I guess this is where immigration comes in as news of the most recent census tells us Canada's population grew primarily because of it, providing two-thirds of new citizens and giving Canada the lead among the G8 in population growth. They have to live somewhere so it is assumed immigrants will provide the demand for new and existing housing keeping prices stable and rising, construction workers steadily employed, land developers and real estate speculators rich, and Canada's ethnic vote pandering political parties and the immigration industry happy. It's win, win, win, everyone wins. Why else would the reigning Conservative government keep immigration levels high during a sever economic downturn when real unemployment is in the double digits, steady well paying jobs are scarce, and precarious work is on the rise?

But that's the problem. What jobs are immigrants doing to pay their mortgages and support Canada's real estate boom? The stories are legion about underpaid yet highly skilled immigrants doing menial work suggesting we didn't need them here in the first place. We know that immigrant cohorts of the past decade are faring worse than previous cohorts of earlier decades and taking a lot longer to meet Canadians at an equal economic footing, if at all, suggesting further we didn't need them here and that good paying jobs didn't exist for them. We know that good paying jobs that supported middle class lifestyles are disappearing (ironically to countries where immigrants are coming from), that low paying precarious work is on the rise, and that income disparities between the wealthiest and the poorest are wide and getting wider. Canada's economy is primarily a branch plant economy and one of resource extraction, finance, and public service. You don't need the largest intake of immigrants in the world to support an economy like that. And finance and public service (the employer of last resort) are currently experiencing job losses. When the Canadian born and educated children of immigrants can't find suitable work how can we expect immigrants to do better?

So is Canada in a real estate bubble? Probably, but if so will it crash or slowly deflate? BMO hopes the latter but saying so is admitting we are in a real estate bubble. (Also recall is was BMO that was the target of mortgage fraud with "new Canadians" being at the centre of it so take that how you want it.) If we are in a bubble then we couldn't have gotten here without mass immigration and I think Jason Kenney is keeping immigration levels high with the hope that the real estate mess immigration got us in will help us get out of it. But if the incomes aren't there, which I don't think they are, then I don't see how you can avoid a devaluation of the Canadian housing market. Frankly I hope it does slowly deflate since this seems like the less painful way to do it but even so, no matter how it plays out, people are going to lose a lot of money one way or another. When Canadians born and bred are being driven out of the housing market how well do you think immigrants are going to fare? And if a devaluation in the housing market fails to occur one thing that cannot be denied is how immigration has made housing costs a lot more expensive for everyone and that contributes to a lower standard of living for all of us Canadians.

Saturday, 4 February 2012

Our refugee system is for real refugees not bogus ones like yourselves. We know you're actually economic migrants posing as refugees to gain quick and easy entry into shopping-mall-Canada so you can greedily pursue your materialist fantasies post haste. It's a loftier ambition to stay in post civil-war Sri Lanka and contribute to the future prosperity and stability of the nation by helping to heal the wounds made by ethnic rivalries. This will greatly benefit the lives of future generations of Sri Lankans. But who cares about them? F**k 'em, as they say. You only care about yourself. You want stuff and you want it now which is why you decided to make a refugee claim in Canada even though you really aren't one.

I know this post is quite crass and harsh but being nice doesn't seem to work. So with niceties abandoned you are being asked to please, f**k off already! Enough is enough! Quit the refugee bullsh**t! How about applying as an immigrant through normal and more socially acceptable channels for once. Is that too much to ask?

I don't spend much time writing about Islam in Canada because the issue is being given enough coverage by better informed bloggers.

But the threat is real and I'm using the Islamic example not to single out Islam but to show how the multicultural social frame work can work against itself and fracture a nation.

A Chinese-centric political party - one I deeply suspect is a puppet political organization with the strings being pulled in Beijing - has already established itself in Canada. Founded and composed of Chinese immigrants it makes one wonder how committed they are to Canada and it's people. Do they see themselves as Canadians or Chinese? If actions speak louder than words than the answer is clear.

As Canadian demographics change and with Quebec nationalism providing the template and precedence I can see other ethnic-centric political parties rising in Canada's political future damning the nation to successive minority governments and fragile coalitions.

Since multiculturalism is an empty concept it will leave little to unite the people across the nation aside from some vague sense of what a Canadian is; if it's anything aside from the legal right to carry a Canadian passport. The country will become ungovernable, fractured, and possibly dissolved.

Diversity is our strength? I doubt that very much and I don't want to let the future tell me I'm right. For the sake of Canadian sovereignty and for future generations it's best to exercise caution and adopt a conservative approach to immigration; bringing it back to one that promotes social stability and unity, not one of instability brought about by ethnic competition, divisions, grievances, and strife.